Remember these terrible things from school?
There is a group of 10 people who are ordering pizza. If each person gets 2 slices and each pizza has 4 slices, how many pizzas should they order?
Why on earth would you remind me of those terrible problems? I hated those things.
Well, I bring them up because, as digital marketers, that’s what we do: We solve story problems to drive impact for organizations. The subjects are a little different (company or organization), the values are a little different (leads, conversions, revenue, engagement, etc.), the storyteller is different (teacher, client, boss), and the problems and solutions are more complex, but the overall structure remains largely the same. Think about it—we’ve all heard some version of this:
“We have a total addressable market of ten million people, half of which already own one of our products and the other half own my competitor’s product. The customers need to re-purchase this product once every five years. They need to buy one refill for the product every year and there are generic universal refills that anyone can buy on the internet. How do I grow my revenue on refillables and also increase my overall market share for the product?”
Oh, wow. He’s right. I always hated story problems. How did I end up doing this for a living?
Spoiler alert: You do this because it’s fun.
Yeah, that’s right, I said it: It’s fun. Consider that what the teacher wants you to answer in the original problem is: (10 people x 2 slices each)/4 slices per pizza = 5 pizzas
Unlike black and white answers, there are a number of ways to solve business problems that generate results.
From Story Problems to Business Problems
Back in school, the problem was the problem. Today as marketers, we get to challenge the teacher’s (or in your case, stakeholder’s) assumptions in the story problem with questions. We get to talk back for once. Let’s look at the pizza problem again. Instead of getting out our calculators, you can begin by asking these types of questions:
- Are you sure there will only be 10 people?
- What’s the occasion?
- Why pizza?
- Who’s paying for these pizzas?
- Does anyone have any food allergies?
- Who’s going to order it?
- Where do we order from?
- What toppings?
- Will the pizza place deliver?
- Are we going to follow up later on whether everyone was happy with the pizza?
- Do we need to send out a survey or can we just ask a few people whether they were satisfied?
It goes on and on and all of a sudden, the problem becomes, yes, fun. And, more importantly, you’re solving something bigger than a simple math problem.
Solving the Problem
We take well-defined problems and make them ill-defined problems with a hundred possible roads in and a hundred possible roads out, all of which is up to you to discover, craft, and solve. An ROI problem may be a leads problems, a nurture problem, a pricing problem, or something else. A lead problem may be an SEO problem, or a paid media problem, or a brand problem…or something else.
So what are you driving at here? What’s the point of this missive?
Good question, fellow marketer. The point is this:
“If you can’t solve a problem, make it bigger.” – President Dwight Eisenhower
As a marketer, your boss might come to you with his or her version of the pizza story problem: They think they have a well-defined ROI problem that more of something will solve. And maybe they have a point.
But, many times, the only way to craft a solution that actually addresses and solves the real problem is to expand the problem itself, make it bigger, and get a feel for the edges of the whole problem, not just what has been told to you.
Let’s take a deeper dive into what this might look like in real life.
Problem Expansion in Action: the Basic
Let’s pretend you’re working on an AdWords performance campaign that’s underperforming. Your first instinct might be to look at the ads. But that’s thinking too narrowly. Instead, if you’re working on an AdWords performance issue, have you considered your quality score, which then ties to the webpages to which those ads are linked? And what about those landing pages? Do they make sense for what the ad is about? Or, maybe you are running just a few ads where you are bidding on super-competitive (read: costly) keywords, so you blow out the problem, look at your full budget, and ask if it makes more sense to go after a bunch of less competitive keywords and triple your number of ads, going after the long tail instead.
If you’re working on an SEO problem and you’re maxing out your content strategy, maybe it’s time to look at your technical SEO setup. Or vice versa. Or maybe it’s time to revisit your content strategy, which means you may need to re-think your target audience, your full-funnel strategy, or even how you position your company entirely. Or maybe you go all the way, doubt the deep doubts, and ask, “What actually is content? Is everything content? Even our product, service, culture, people, let alone our message?” (I know, it seems a little touchy-feely or even overly intellectual. The point stands, however.)
Let’s Get Even More Advanced
Here’s a doozy of a business problem:
The company you work for has been in business for 40 years, has a $1M yearly marketing budget spread across two brands and three service lines for each brand, with total revenue of $12M a year. You can’t combine the brands, you can’t change the brand voice or messaging, and your marketing mix has tried-and-true methods, including traditional marketing, all of which makes your boss wary of change. However, your boss knows he has to improve on digital channels in order to keep up with the times. Using only digital marketing tactics, where will you recommend to place marketing dollars?
To tackle this problem, you’ll need to do more than put together your best recommendation based on best practices, present it to your boss, and hope for the best. In this case, who you are pitching to is as important as what you are pitching.
Your boss, in this case, is wary of change because he’s been able to grow and maintain a business in the same way he always has. However, he isn’t sure where to change and, maybe, whether to change at all. For you, the only way to convince your boss to change is to come in like a boss yourself—know your numbers, understand the mix, the revenue, where it comes from, conversion rates, and growth areas, and make the business case. First, you need to expand the problem.
Let’s say you have this basic information to go with:
Based on those numbers, you can glean valuable information doing some basic math to calculate ROI, cost per lead, average value of a new customer, percentage of leads to sales, and average value per sale, on top of layering in your own marketing information like spend per channel and calculating figures like cost per lead per channel.
The most eye-popping math is that leads are expensive to gather (nearly $1,000 each for Brand 2), but they are valuable (worth nearly $20,000 per sale). So every lead lost essentially flushes $1,000 down the drain. Following that, you can readily come to the following conclusions:
- There is a massive amount of value in keeping more leads in the sales pipeline.
- There is more lifetime value for Brand 2’s customers.
- Brand 1’s market is hypothetically easier to reach, but Brand 2’s customers stick around longer.
- Brand 2’s Web:PPC lead ratio is considerably less than Brand 1’s.
Using those conclusions, what digital marketing tactics would you suggest to your boss? Where can you make the greatest impact?
The first suggestion I would make is to invest in a marketing automation platform to better nurture leads as well as cross-sell those customers down the line. Basically, our first layer of growth is to get more out of our current efforts—there’s too much waste and loss.
The second suggestion I would make is to understand why we have a disparity in website-to-PPC leads across brands. I would recommend an SEO audit using a platform like SEMRush or Moz. I would then do a deep-dive on our PPC accounts to check for quality scores, keyword competition, ad formatting, average cost per click, and overall budget.
The final part of this is to stress to your boss the business case here: At a value of $20,000 per new sale, if you can make just a few more sales because of marketing automation and SEO tools, then these tools pay for themselves. If you can tighten up your PPC account, then you will get more bang for your buck as well.
Finally, I would recommend refining our analytics and tracking in order to better understand what “All Other” means and better refine our digital marketing tactics going forward.
There are more ways to solve this problem, there’s no doubt. That’s the thing about story problems—they appear as well-defined problems and we blow them out into ill-defined problems with many possible solutions. It’s what digital marketers do.
Don’t Confine Yourself to the Edges of the Problem at Hand
You can take your boss’, stakeholders’, or clients’ story at their word, give them five pizzas for their party of ten people and be done. There’s a time and place for that. But, in my experience, you never really solve the problem until you understand and clarify the assumptions behind it.
Now, go solve some story problems. It just may not be the story presented to you.
Dustin Clark // Strategy
How to Get Budget Approval for Marketing Initiatives
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